The European regulators have already closed the European subsidiary of state-owned Russian Sberbank. The US, the UK, EU, and Canada agreed to expell seven Russian banks from the SWIFT messaging system. The ban does not include Sberbank and Gazprombank. They were exempted because they handle most of the payments related to gas and oil exports, on which the EU heavily depends to produce energy. Around 40% of the gas consumed by the bloc comes from Russia.
Russia’s second-largest bank VTB, Bank Otkritie, Novikombank, Promsvyazbank, Bank Rossiya, Sovcombank, and VEB will each be given 10 days to wind down their SWIFT operations.
The bloc also imposed a ban on issuing bonds, shares, or loans in the EU for refinancing Alfa Bank and Bank Otkritie, after freezing assets at Rossiya Bank, Promsvyazbank, and VEB earlier last week.
Moreover, the EU Council decided in particular to prohibit:
- to invest, participate or otherwise contribute to future projects co-financed by the Russian Direct Investment Fund.
- sell, supply, transfer or export euro denominated banknotes to Russia or to any natural or legal person, entity or body in Russia, including the government and the Central Bank of Russia, or for use in Russia.
Additionally, Britain decided to ban Russian companies from London’s aviation and space insurance market. UK-based insurance and reinsurance providers, such as those who use the Lloyd’s of London market, will be prohibited from undertaking transactions linked to a Russian entity or for use in Russia.
According to the EU, the economic sanctions on Russia targeted 70% of the Russian banking market.
